16)For the following stream of free cash flows, calculate the internal rate of return. Year 0 1 2 3 4 5 Free Cash Flows -45,452 10,005 14,921 12,537 10,452 21,455 Group of answer choices 14.5% 12.7% 13.9% 11.5%

16)For the following stream of free cash flows, calculate the internal rate of return. Year 0 1 2 3 4 5 Free Cash Flows -45,452 10,005 14,921 12,537 10,452 21,455 Group of answer choices 14.5% 12.7% 13.9% 11.5%

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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16)For the following stream of free cash flows, calculate the internal rate of return.

Year	0	1	2	3	4	5
Free Cash Flows	-45,452	10,005	14,921	12,537	10,452	21,455

Group of answer choices

14.5%

12.7%

13.9%

11.5%

Definition Definition Cash that is left over after a company has paid for its operating and capital expenses. Unlike net income or earnings, free cash flow excludes non-cash expenses of the income statement and includes the expenditures on equipment and assets. Free cash flow also helps potential shareholders to evaluate how quickly the company can pay interest and dividends.

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